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FCA

FCA

Financial Conduct Authority (UK)

Medium Impact

FCA Decision Notice against Richard Fenech highlights principal oversight failures in DB pension transfer advice

Published

Aug 3, 2026

Topics

Enforcement, Defined benefit pension transfers, Appointed representatives, Principal firm oversight, Suitability, Senior management accountability, Integrity and fitness and propriety

Executive Summary

The FCA has published a Decision Notice against Richard Brian Fenech, sole director and approved person at Financial Solutions Midhurst Limited, proposing a £270,646 financial penalty and a prohibition from performing any function in relation to regulated activity. The notice concerns FSML’s oversight of its appointed representative, Heather Dunne trading as HDIFA, which provided defined benefit pension transfer advice during 3 January 2015 to 22 June 2017. The FCA alleges Mr Fenech breached APER Statement of Principle 1 by failing to act with integrity, including by permitting a deficient two-adviser advice model to continue despite compliance concerns and by providing a backdated appointed representative agreement to the FCA. It also alleges breach of Statement of Principle 7 for failing to take reasonable steps to ensure adequate controls, information-gathering, suitability reports and personal recommendations. This is not a new rulemaking measure, and Mr Fenech has referred the notice to the Upper Tribunal, meaning the proposed FCA action has no effect pending the Tribunal’s determination.

What Changed

newProposed individual sanction

Previous

No final sanction against Mr Fenech under this notice was in effect before the Decision Notice.

New

The proposed penalty and prohibition are set out in the Decision Notice but have no effect pending the Upper Tribunal’s determination.

newUpper Tribunal referral

Previous

The matter was before the FCA’s Regulatory Decisions Committee following a Warning Notice dated 6 March 2023.

New

The Upper Tribunal will determine the referred matters and its decision will be made public.

newTwo-adviser DB transfer model enforcement focus

Previous

During the relevant period, two advisers could provide separate transfer and investment advice, but FCA alerts had warned that transfer advice must consider the overall investment strategy.

New

The Decision Notice reinforces that, where a transfer is linked to an onward investment strategy, suitability of the underlying or destination investment must be considered as part of the transfer advice.

newPrincipal oversight and AR contract failings

Previous

FSML relied heavily on HDIFA’s experience and did not undertake regular compliance audits or suitability reviews during the relevant period, according to the Decision Notice.

New

The FCA treats the absence of effective AR controls, file review, escalation and written contractual arrangements as serious indicators of inadequate principal oversight.

newSuitability file and disclosure deficiencies

Previous

HDIFA used fact-finding and suitability report processes involving introducing advisers and HDC Limited, with HDIFA not meeting customers directly.

New

The notice emphasises the need for pension transfer files to capture financial situation, retirement income needs, attitude to risk, customer objectives, alternatives, disadvantages and clear rationale for suitability.

Business Impact

Who is affected

Directly affected

Mr Richard Fenech and firms or individuals involved in the Upper Tribunal referral concerning this Decision Notice.

Indirectly affected

UK FCA-authorised principal firms, appointed representatives, pension transfer specialists, financial advisers using two-adviser models, compliance officers, senior managers responsible for advice oversight, file review teams, and firms with legacy DB pension transfer books.

Jurisdictions

United Kingdom

Business processes

Appointed representative onboarding and written agreement controls, Ongoing AR oversight, monitoring and escalation, Defined benefit pension transfer advice governance, Two-adviser model design and destination investment assessment, Suitability report production and approval, Pension transfer file reviews and quality assurance, Regulatory information request handling and document integrity controls

Estimated effort

Medium

Compliance risk

High

Affected Reports

Appointed representative written agreement and onboarding controlAR supervision, monitoring and periodic review recordDefined benefit pension transfer suitability file review checklistSuitability report and personal recommendation quality assurance controlTwo-adviser model and onward investment suitability oversight control
FieldValidation rule

Recommended Actions

7 suggested next steps· derived from source analysis
  1. 1
    AI generatedStep 1 of 7

    Review all active appointed representative arrangements to confirm that written contracts are complete, current, signed, retained and aligned with SUP 12 requirements.

  2. 2
    AI generatedStep 2 of 7

    Test whether AR oversight frameworks include risk-based file reviews, documented escalation, management information and independent challenge for high-risk advice activity.

  3. 3
    AI generatedStep 3 of 7

    For any two-adviser or split-advice model, document how the firm obtains and assesses destination investment information before making or approving transfer advice.

  4. 4
    AI generatedStep 4 of 7

    Reassess DB pension transfer file standards against COBS suitability requirements, including income needs, financial commitments, reliance on safeguarded benefits, attitude to risk, alternatives and customer-specific objectives.

  5. 5
    AI generatedStep 5 of 7

    Review suitability report templates to ensure recommendations, disadvantages and alternatives are customer-specific, fair, clear and not misleading.

  6. 6
    AI generatedStep 6 of 7

    Check regulatory request protocols to ensure documents supplied to the FCA are accurate, dated correctly, complete and subject to senior sign-off.

  7. 7
    AI generatedStep 7 of 7

    Where legacy DB transfer advice was given through ARs or introducers, consider targeted past-business assurance to identify customer harm, complaint exposure and remediation triggers.

Timeline

other

Jan 18, 2013

FCA predecessor alert reminded advisers that pension transfer advice must take account of the overall investment strategy the customer is contemplating.

other

Apr 28, 2014

FCA alert stated that suitability of the underlying investment must form part of the advice given to the customer.

other

Jan 3, 2015

Start of the relevant period assessed in the Decision Notice.

other

Jun 15, 2017

The FCA visited HDIFA’s offices as part of its review of FSML’s approach to defined benefit pension transfer advice.

implementation

Jun 16, 2017

Following FCA intervention, FSML applied for voluntary requirements requiring it to cease regulated activities relating to defined benefit pension transfer business.

other

Jun 22, 2017

End of the relevant period; the Decision Notice states that the AR agreement was signed and provided to the FCA on this date.

publication

Jan 2, 2024

FCA Decision Notice dated 2 January 2024 proposed a £270,646 penalty and prohibition order; the matter has been referred to the Upper Tribunal.

Sources

AI-generated analysis is based on the following primary sources. Always verify against the official publication.

Related Evidence

Verified source support for this analysis

The evidence agent checks whether the drafted finding is supported by official publications and relevant public source material.

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